Chief Financial Officers (CFOs) are more than just accountants. These professionals play an active role in company operations, offering advice and strategy-related assistance that drives revenue.
However, not all companies want to hire CFOs full-time – they’re expensive. So, that’s where virtual CFOs can help. These professionals provide all the support of a conventional in-house CFO but at a fraction of the cost.
This post discusses how virtual CFOs can drive business growth and improve strategic outcomes, highlighting their roles in risk management and financial decision-making.
Superior Financial Analysis
The primary role of virtual CFOs is to provide your company with superior financial analysis. Professionals use their expertise to monitor all aspects of your firm’s performance, including:
- Developing a financial strategy and ensuring optimal capital and financial resource allocation
- Identifying tax breaks and opportunities that could provide improve financial performance and cash flows
- Navigating through challenging market conditions and implementing strategies to manage the company’s financial position
Virtual CFOs can also engage in so-called “scenario planning.” These exercises attempt to estimate how your firm might perform across multiple futures and help you begin planning today for likely future outcomes. Forecasting analysis is often helpful if you want to expand to new locations, launch a new product, or change your current marketing campaign.
Cost Management
Virtual CFOs can also assist your company with its cost management. Often, their work involves going over your expenses and looking for opportunities to save money without sacrificing your underlying operations.
This role is particularly valuable in fast-expanding businesses. Companies with lots of employees and managerial layers can eliminate bloat-related issues that prevent them from turning a profit as early as they would like. Virtual CFOs explore these forensically, weeding out wasteful spending.
Cost management can also involve process optimisation in manufacturing businesses (or service-based enterprises with complex workflows). Technical virtual CFOs identify automated tasks and then suggest solutions to bring down expenses.
Mentoring
You can also leverage virtual CFOs for mentoring. Professionals usually have vast experience they can deploy to assist your in-house finance team.
Mostly, this process involves them taking the lead and providing employees with guidance and bespoke advice, helping professionals develop new skills. However, they can also give you direct advice on things like prudent financial planning and when (from their perspective) would be the best time to make a significant decision.
Regulatory Assistance
Providing regulatory assistance is another way virtual CFOs can help you. These professionals often have in-depth knowledge of the rules, helping you avoid external audits and penalties from regulatory authorities.
Virtual CFOs streamline the process of staying compliant by providing you with immediate, actionable advice, enabling you to focus on your business with the confidence that your finances are in safe hands.
Strategic Growth Planning
Strategic growth planning is one of the more advanced virtual CFO services that drive business expansion. These sessions help you develop long-term operational strategies for your firm, helping you align processes with your vision.
The best strategic growth planning shows you market opportunities you could exploit to get to where you want to go. Virtual CFOs often have sectoral insights, showing where the highest margins will be made in coming quarters, letting you adjust your strategy now. They can also recommend performance monitoring to check you’re on track periodically. These metrics keep you on the straight and narrow, allowing you to chart progress towards an objective.
Cash Flow Management
Finally, virtual CFOs can drive strategic business growth by assisting with cash flow management. Their work helps you anticipate when you will have cash surpluses and deficits, allowing you to plan spending better.
Part of this work involves managing accounts receivable and payable. However, it can also include fundraising efforts, showing investors when you’ll require money and how much, according to your business plan.
Ready to Hire a VCFO?
Looking to modernise your approach to financial management or want to future-proof your business? Consider hiring a VCFO today!
After all, welcoming a VCFO to your growing team will enable you to:
- Access expert support and guidance without the costs of hiring a full-time employee.
- Take a step in the right direction when growing and scaling your business, and ensure that you have a strong foundation set up to do so.
- Make the most of tax initiatives and schemes while ensuring compliance across the board.
- Relax, knowing that your finances are being taken care of without placing an additional burden on your existing team.
Get in Touch
If you aren’t sure where to start when finding a VCFO you can trust, look no further than Prime. With years of industry experience, our accounting and business advisory services are built with small businesses in mind. Whether you need assistance when it comes to financial forecasting and raising capital or simply want to ensure your books are accurate and up to date, we’ve got you covered!
CFOs are more than just financial gatekeepers, and when you have the right CFO on your side, you can take your business from strength to strength. If you’d like to find out more, please do not hesitate to reach out today by filling out the form below to set up a consultation.
